Elliott backs Garnier for Actelion board but still wants changes

In the latest development over the future direction of Actelion, dissident shareholder Elliott Advisors has supported the Swiss biotech board's plan to bring in former GlaxoSmithKline boss Jean-Pierre Garnier and ex-Schering-Plough chief financial officer Robert Bertolini.

Elliott, which has a near-6% holding in Actelion, has been highly critical of the company's board and both sides have been appealing to shareholders ahead of an eagerly-anticipated annual general meeting on May 5. Now, the hedge fund, which has attacked Actelion's management steadily for three months, has actually applauded one of its moves.

It says that the nomination of two "independent and well-qualified board members is a step in the right direction" but adds that it "clearly does not go far enough to create real change that will increase shareholder value". Elliott says it will support the Garnier and Bertolini nominations but still wants its proposed slate of six candidates (headed by James Shannon, a former global head of pharma development at Novartis) to be elected.

The fund also urged shareholders to support a resolution removing a restriction on the maximum size of the board, saying Actelion backers "are being deprived of a real choice" by executives who are "running a high-risk strategy for the future of the company".

No offers received, chairman tells Reuters

Elliott's comments came after Actelion's chairman Robert Cawthorn gave an interview to Reuters saying that the firm has never received a takeover bid. However, he noted that "if there ever were an offer to be made for the company that was even close to the value that the board sees in this company ... this board would absolutely consider it".

Mr Cawthorn added that "if appropriate we would recommend it to the shareholders", even chief executive Jean-Paul Clozel who has regulary argued that Acteion should stay independent. The latter "might not like it because this is his baby, but he knows what his responsibilities are," he said.

Still, Mr Cawthorn told Reuters that "this is the absolute worst possible time to start thinking of selling this company" as it would "really take potential value out of the pocket of our shareholders. If it were so attractive, why haven't there been people coming out of the woodwork wanting to buy us in the last few months?"